18.1 Introduction

The imperative to transfer powers, functions, responsibilities, and accountabilities to local governments through a process of decentralization has been central to the value to encourage citizen participation and deepen the democratization process. It is within this context that many countries in the region have adopted decentralization as a strategy to deepen democracy and empower local governments.

In the Philippines, Republic Act 7160, commonly known as the Local Government Code of 1991 (LGC), was enacted. The code has been considered as a landmark, far reaching, and the most radical piece of legislation in the history of the Philippine politico-administrative system. It devolved significant functions, powers, and responsibilities to the thousands of local governments in the country that have long been operating under a highly centralized regime (Brillantes 2003, 2002, 1998).

This chapter is divided into five sections. Section two provides a historical brief of local autonomy and decentralization in the Philippines. Section three highlights the LGC: its key features and the current state of local governments, the gains and the emergent challenges of the policy design and its implementation over the past 17 years. It also discusses some critical reviews of decentralization. Section four discusses local governance reforms and capacity building directions toward a more desirable design and implementation of decentralization. Section five provides the conclusions and way forward.

18.2Toward a Genuine Local Autonomy and Decentralization in the Philippines

18.2.1 Evolution of Local Autonomy

The development of local autonomy in the Philippines can been traced as far back as the pre-His- panic societies when the chieftain of native settlements exercised executive, judicial, and legislative powers assisted by a Council of Elders. The monarchial chieftain, called the datu, panginoo, or pangulo, headed an autonomous territorial and political unit.

The colonial governments of the Spanish colonizers consolidated autonomous villages into pueblos (towns), cabildos (cities), and provincias (provinces). They enacted the Maura Law 1893, which established tribunals, municipals, and juntas provincials, but the government remained centralized.

In 1898, the Malolos Constitution introduced “decentralization” and “administrative autonomy” by instituting localized law-making bodies through the municipal and provincial assemblies. Local officials were then elected on a popular basis.

During the American occupation (1902–1935), a number of policies were promulgated promoting local autonomy; however, because of security considerations, local affairs had to be under the control of the Americans. The Commonwealth placed local governments under the general supervision of the president, who could, in effect, create or abolish them.

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Decentralization and Local Governance in the Philippines 357

In 1959, the first local autonomy act (RA 2264) entitled “An Act Amending the Laws Governing Local Governments by Increasing their Autonomy and Reorganizing Provincial Governments” was enacted. This act vested in city and municipal governments greater fiscal, planning, and regulatory powers. It broadened the taxing powers of the cities and municipalities within the framework of national taxing laws.

In the same year, the Barrio Charter Act (RA 2370) sought to transform the barrios, the smallest political unit of the local government system, into quasi-municipal corporations by vesting in them some taxing powers. An elective barrio council governed the Barrios.

The “Decentralization Act of 1967” (RA 5185) further increased the financial resources of local governments and broadened their decision-making powers over administrative (mostly fiscal and personnel) matters.

The imposition of martial law in 1972, which abolished local elections and vested in the dictator the powers to appoint local officials who were beholden to him, was a great setback for the local autonomy movement. The 1973 Constitution rhetorically committed itself to a policy of “local autonomy.” The Local Government Code of 1983 (Batas Pambansa Bilang 337) reiterated the policy of the state of local autonomy.

After the fall of the Marcos dictatorship, the 1987 Constitution was promulgated. It included specific provisions guaranteeing autonomy to local governments. The LGC was enacted in 1991.1 It was only then that a genuine local autonomy started to take root after a number of patchy policy statements and given the country’s past of a highly centralized politico-administrative system.

18.2.2 Government Structure and the Local Government System

The 1987 Philippine Constitution enshrined a new politico-institutional system that hoped not to repeat an authoritarian regime experienced under former President Ferdinand Marcos. Some of its key features include checks and balances, term limits for elective positions, people empowerment, and the promulgation for a genuine local autonomy in the Philippines. It provided the enabling policy framework for decentralization under the new LGC.2

The Philippines is a presidential-unitary state headed by a president with co-equal branches of government—the executive, the bi-cameral legislature (Senate and the House of Representatives), and the Supreme Court (SC). Its president is elected for a 6-year term and cannot seek re-election. The Senate comprises 24 nationally elected senators, while there are more than 220 lower house seats for congressional district representatives and a few more for sectoral-party list representatives.

It has a three-tier local government system—province, city/municipality, and barangays (village or the lowest political unit). The 1987 Constitution provided for the creation of autonomous regions or metropolitan political regions. The Autonomous Region of Muslim Mindanao (ARMM) was created as a political region—an institutional response to the peace conflict in Muslim Mindanao—to be headed by an elected governor. The Metropolitan Manila Development Authority (MMDA), formerly Metro Manila Council, was designated as a special development authority with functions to coordinate metro-wide services, plan for regional development, and respond to externalities that have trans-border effects. An appointed chairman heads the MDDA, who is under the direct supervision of the Office of the President. Figure 18.1 shows the structure of local government system in the Philippines.

1 This summary draws from Brillantes and Moscare (2002).

2 This section also appears as a sub-section of the MA thesis of Tiu Sonco (2009).

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Table 18.1 Number of Local Government Units, Various Years

Sources: National Statistical Coordination Board; DILG.

*Unofficial data source. Computed by the author based on various reports.

Figures in 2009 indicate a major change in the number of cities and municipalities, and a decrease in provinces. In December 2009, the Supreme Court declared the laws the created the 16 cities as constitutional. Another city and two barangays were created in March 2010.

18.2.3 Devolution under the Local Government Code of 1991

The LGC devolved powers and functions including the delivery of basic services; responsibility to enforce regulatory powers; power to increase financial resources by broadening their taxing powers, shares from internal revenues, and the exploitation of national wealth; legitimization of participation for civil society in local governance; and authority to engage in entrepreneurial and development activities. Table 18.2 presents its key features and the powers, authorities, and functions devolved to local governments. Annex 18.1 indicates the devolved services by LGU level, which include agriculture, environment, health, social welfare, education, public works, tourism promotion, and the administration of justice.

In hindsight, the proponents of the LGC hoped to “bring development to the countryside, by allowing local governments develop at their own pace.” As such, the LGC provided for the

Table 18.2 Devolved Functions and Key Features of the 1991 LGC

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